How To Make Offshore Manufacturing Work

When offshore manufacturing works well, it can be fast, cost-efficient, and deliver good quality. But often speed, price, or quality is sacrificed without the right vendor, relationship, and process. Think of the benefits of off-shore manufacturing in terms of a three-legged stool. Most can have two out of three legs, but getting all three from an offshore vendor — and not falling hard in the process — takes plenty of work, time, and experience in managing offshore manufacturing relationships.

Three-legged stool

Speed, price, and quality — you can have two, but three is a tougher proposition.

In the past few years we’ve seen several instances where clients have gone directly to China with their rough concepts. The resulting products, which were designed and built overseas, didn’t work — something was lost in the translation. Ultimately, in two cases, the companies, one a startup and the other a more established outfit, came to us and we designed the products from scratch. We brought them to market, but our clients had already lost a year and all they had to show for it was a worthless prototype.

Ironically, in both cases we ended up working with other overseas vendors to commercialize and manufacture the products, and the final results were much more successful than the clients’ initial ventures overseas. We knew from experience how to get the best result. Here are some best practices we’ve developed over many years of working with offshore vendors:

Stay involvedKeep a hand or two in the development.

Unless the vendor is vetted and trusted, you should never hand off a project completely. Stay as involved as possible. The process is most likely to go well if you have someone on the ground in China overseeing the development, making decisions, and reviewing the design direction intimately.

Another option that is often just as good is to keep your domestic design and engineering experts engaged as consultants during the product’s overseas commercialization process. This takes time and commitment, especially managing early morning and late night schedules to communicate with overseas vendors during their working hours, but it’s worth it.

Double-confirm directives, and map out check points.

We had a client send a CAD database with partially developed design details to a vendor who assumed it was ready to go and implemented it as engineering. The engineer who was working on the product here knew it was only 75% there, but the vendor couldn’t tell the difference and operated on the expectation it was going to commercialize the product. This kind of expensive misunderstanding is a good argument for keeping your U.S. designers and engineers involved as consultants.

Cleancut

We consulted closely with the vendor who commercialized CleanCut.

The lesson: Always clearly map out review points at the beginning of a vendor relationship. Insist on the opportunity to review tooling drawings after you’ve released engineering drawings. Building tooling is a hefty investment and can cause huge delays if done wrong.

For complex products, harness the expertise of a design engineer.

Going directly to China with a concept is a hard thing to make work, especially with a product involving any kind of complexity.

With complex electromechanical or mechanical, what you see externally never tells the whole story. You need to understand the nitty-gritty of what’s making it work and how it works, and inventors don’t necessarily grasp the technical details like an engineer does. Without that knowledge, an inventor will have difficulty directing someone else on how to make the product and is likely to sign off on bad decisions.

Once you choose an offshore vendor, that design engineer can guide the commercialization. One successful offshore relationship of ours resulted in bringing a product for SmartVent to market — the CleanCut, an automatic paper towel dispenser with gestural interface. In this case, the engineers at Bresslergroup who had developed the product were able to stay involved during its commercialization process.

The vendor had U.S. reps with some understanding of the technical aspects of the product with whom we could talk directly and who saw the benefit of working directly with us. In several late night phone conferences, we were able to speak and computer teleconference directly with project managers at the plant in China.

Internet tools like GoToMeeting are essential for maintaining design control at a distance.

Communicate visually.

Depending on words alone is opening yourself up to misinterpretation. Visuals are much harder to misconstrue. Frame your communication visually and make it as detailed as possible — screenshots from a CAD database, illustrated spreadsheet, or PowerPoint deck are preferable to emails and purely text-based descriptive lists.

Documentation

A snippet of one of our offshoring spreadsheets, with plenty of details and plenty of visuals.

Insist on clarity — and be aware of cultural differences.

There’s a cliché that the Chinese won’t say “no” in a business setting or ask questions if they don’t fully comprehend something, either because they don’t want to lose face or because they think their way is better. Like all clichés, there’s some truth to this, and we’ve encountered it. It’s best to be careful and to not take a “yes” or a “no problem” at face value. Be very clear when transmitting the design and engineering intent — as we advised above, use plenty of visuals.

Document the vendor’s response, and follow up. With one project, we worked from a lengthy spreadsheet (“reams” of paper would not be an exaggeration) with rows of visuals depicting what we wanted the product to look like at every stage — from prototype to fully commercialized product — and included lines for the vendor to sign off on every detail. Ask for the same type of documentation from the vendor — PPT, Excel, PDFs with visuals.

Watch out for vendors who promise the moon.

They may be overselling their capabilities. We’ve found there’s an inverse relationship between the flashiness of a website and the sophistication of a vendor’s plant and capabilities. Of course, once every blue moon you may run into a vendor who can deliver the moon. …

A final piece of advice: Hang on to that vendor.